Key Points Summary:
· The trend of enterprises acquiring crypto assets through leveraged financing may potentially cause systemic risks in the medium to long term, such as forced selling or motivated selling, but we believe the risks are controllable in the short term.
· The US regulatory environment is undergoing positive changes, with stablecoin legislation being advanced and the crypto market structure bill under discussion.
Our constructive outlook for the crypto market in the second half of 2025 is based on several core factors: more optimistic US economic growth prospects, potential Fed rate cuts, growth in corporate crypto adoption, and clearer US regulations. Although some potential risks exist, such as steepening US Treasury yield curves and selling pressure from listed crypto tools, we believe these risks are manageable in the short term.
We believe there are three key themes in the second half of the year:
1. Improved Macro Prospects: US recession risks have significantly decreased, with overall growth momentum strengthening;
2. Corporate Adoption of Crypto as an Asset Allocation Method: While potentially causing systemic risks in the long term, creating strong demand in the short term;
3. Increasingly Clear Regulatory Pathway: Especially the progress in stablecoin and crypto market structure legislation, which will profoundly impact the crypto ecosystem.
Despite risks, we still anticipate Bitcoin will maintain an upward trend. Altcoin performance may depend more on individual factors. For instance, the SEC is reviewing multiple ETF applications involving "physical creation and redemption", staking, portfolio funds, and single Altcoin ETFs, expected to be ruled on before the end of 2025, potentially reshaping market structure.
Market Outlook: Second Half of 2025
[The rest of the translation follows the same professional and accurate approach, maintaining the original meaning while translating to English.]Theme Three: Launching a New Era of Regulation
In the first half of 2025, U.S. crypto policy underwent unprecedented dramatic changes. The White House abandoned the old approach of "enforcement instead of regulation" and fully turned to supporting crypto industry development. We believe stablecoin legislation is most likely to be implemented first. Currently, the House is advancing the STABLE Act, and the Senate is advancing the GENIUS Act, both of which have received bipartisan support. On June 11, the Senate passed the GENIUS Act and sent it to the House for review. Both bills set reserve requirements, anti-money laundering compliance, bankruptcy protection, and consumer rights clauses.
The main differences are:
· How to handle non-U.S. stablecoin issuers
· How to set regulatory thresholds
The White House is expected to complete a unified bill version before the congressional recess on August 4 and submit it to the president for signature, potentially laying the groundwork for subsequent market structure legislation.
Crypto Market Structure Act (CLARITY Act)
On May 29, 2025, the U.S. House Financial Services Committee officially proposed the Digital Asset Market Clarity Act (CLARITY Act) draft, which is considered the most transformative legislation of the year.
The bill aims to clarify the regulatory boundaries between SEC and CFTC for crypto assets, with regulation divided based on asset properties (such as "digital commodities" or "investment contracts"). The bill is built on last year's FIT21 Act and requires the SEC and CFTC to jointly define key terms and continuously develop rules, indicating that regulatory division still has room for evolution. We believe this will become the basis for future inter-chamber negotiations, but its complexity and uncertainty will be higher than stablecoin legislation.
ETF Progress Timeline
The SEC is facing about 80 crypto ETF proposals in 2025, covering:
· Multi-asset Crypto Index Funds (Bitwise, Franklin, Grayscale, etc.): Decision as early as July 2;
· In-kind Redemption/Purchase Mechanism: Possible result in July, delayed to October at the latest;
· Staking Inclusion: Limited by 6c-11 clause transparency, SEC may decide in advance;
· Single Altcoin ETFs: Most applications' deadline is October, with SEC expected to use the entire review period.
Conclusion
We are optimistic about the crypto market prospects in the third quarter of 2025, thanks to a relatively optimistic U.S. economic growth outlook, Fed rate cuts, increasing corporate crypto adoption, and improved U.S. regulatory transparency. Although risks such as steepening U.S. Treasury yield curves and potential PTCVs selling pressure exist, they remain controllable in the short term. We believe the BTC upward trend will continue, though Altcoin performance will depend on individual project performance.
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